EXHIBIT 10.1
AMENDED AND RESTATED
GUARANTY
THIS AMENDED AND RESTATED
GUARANTY (this
“Unlimited Guaranty” ), dated as of
July 28, 2008, made by SMURFIT-STONE CONTAINER ENTERPRISES,
INC. , a corporation organized under the laws of the State of
Delaware having its chief executive office at 150 North Michigan
Avenue, Chicago, IL 60601 (“ Guarantor ”)
in favor of THE CIT GROUP/EQUIPMENT FINANCING, INC ., as the
initial lender (the “Initial Lender” ) and as
Administrative Agent for the benefit of the Lenders (as defined
below) (the “ Administrative Agent ” and
together with the Lenders, the “ Beneficiaries
”).
WHEREAS, pursuant to that Credit Agreement dated as of
March 30, 2006 (as subsequently amended, the
“Original Credit Agreement” ), by and between
Calpine Corrugated, LLC (formerly known as Produce Container, LLC
(the “ Borrower” ) and the Administrative Agent
and Initial Lender and such other financial institutions as may
become parties thereto from time to time (together with the Initial
Lender, the “ Lenders” ), the Initial Lender
made advances to Borrower in the aggregate principal amount of
$40,350,000.00 to finance the purchase and installation of
equipment for the manufacture of corrugated containers at
Borrower’s facility in Fresno, California (the
“Manufacturing Facility” ), which advances were
subsequently converted to a Term Loan evidenced by that Term Note
in favor of the Initial Lender effective as of November 30,
2006;
WHEREAS, pursuant to that Guaranty dated as of
March 30, 2006 (the “Original Guaranty ”),
the Guarantor provided a limited guaranty of the obligations of
Borrower under the Original Credit Agreement;
WHEREAS, the Borrower, the Administrative Agent and the
Initial Lender thereafter amended the Original Credit Agreement in
certain respect pursuant to that Amendment No. 1 to Credit
Agreement entered into as of October 30, 2006, that letter
agreement denominated Amendment No. 2 to Credit Agreement
dated November 30, 2006, and that Amendment No. 2
[sic] to Credit Agreement entered into as April 23,
2007;
WHEREAS, during 2007 the Working Capital Lender (as
defined in the Original Credit Agreement) advised the
Administrative Agent of the occurrence of certain “Events of
Default” (the “ Revolver Defaults ”) under
the Working Capital Loan Documents (as defined in the Original
Credit Agreement);
WHEREAS, by letter dated November 30, 2007, the
Administrative Agent notified the Borrower and the Guarantor that
certain Events of Default (collectively, the “ Identified
Defaults ”) had occurred and were continuing under the
Original Credit Agreement, including breach of certain financial
covenants in the Original Credit Agreement and the existence of the
Revolver Defaults;
WHEREAS, the Borrower, the Administrative Agent, the
Initial Lender and the Guarantor subsequently entered into
negotiations to restructure the Original Credit Agreement and other
Loan Documents, and pursuant to that Amendment No. 4 to Credit
Agreement, Reservation of Rights and Reaffirmation of Guaranty
entered into as of December 28, 2007, that Amendment
No. 5 to Credit Agreement, Reservation of Rights and
Reaffirmation of Guaranty entered into as of January 31, 2008,
and that Amendment No. 6 to Credit Agreement, Reservation of
Rights and Reaffirmation of Guaranty entered into as of
February 29, 2008, the Borrower, the Administrative Agent, the
Initial Lender and the Guarantor further amended the Original
Credit Agreement on the terms and conditions set forth
therein;
WHEREAS, the Borrower has failed to make the principal
payments due under the Original Credit Agreement as of
March 14, April 14, May 14 and June 14, 2008
(the “ Payment Defaults, ” and collectively with
the Identified Defaults and any other Defaults described on
Schedule 1.01(a) to the Credit Agreement (as defined
below), the “Existing Defaults ”);
WHEREAS, pursuant to that Amended and Restated Operating
Agreement of Calpine Corrugated, LLC (the “Calpine
Operating Agreement” ) dated as of the Effective Date (as
defined in the Credit Agreement), the existing members of the
Borrower and the Guarantor have restructured the Borrower to, among
other things, admit the Guarantor as a Member (as defined in the
Calpine Operating Agreement) owning a 90% Percentage Interest (as
defined in the Calpine Operating Agreement) in the
Borrower;
WHEREAS, the Borrower and the Guarantor have requested
that the Administrative Agent and the Initial Lender (i) waive
the Existing Defaults and the right to collect interest at the
Default Rate (as defined in the Original Credit Agreement) as a
result of the Existing Defaults (ii) enter into an Amended and
Restated Credit Agreement (the “ Credit Agreement
”) and (iii) otherwise amend the Loan Documents on the
terms and subject to the conditions set forth in the Credit
Agreement, in consideration for which the Guarantor has agreed to
amend and restate the Original Guaranty to provide a full guaranty
of the Term Loan and all obligations of the Borrower under the
Credit Agreement;
WHEREAS, the Borrower, the Administrative Agent, the
Initial Lender and the Guarantor have agreed that, on the Effective
Date, the Original Credit Agreement, the Term Note and the Original
Guaranty will each be amended and restated in its entirety, and
other Loan Documents will be further amended in certain respects,
in each case as provided in, and on and subject to the terms and
conditions set forth in, the Credit Agreement;
WHEREAS, the Administrative Agent and the Initial Lender
are unwilling to waive the Existing Defaults and the collection of
interest at the Default Rate, to enter into the Credit Agreement
and to otherwise provide the concessions requested by the Borrower
and Guarantor unless, among other conditions, the Guarantor shall
have executed and delivered this Unlimited Guaranty in favor of the
Administrative Agent (for the benefit of all Beneficiaries);
and
WHEREAS, the Guarantor, both through its contractual
relationships with the Borrower and as 90% owner of the Borrower,
has derived and will derive substantial economic benefit from the
financing provided by the Initial Lender to the Borrower pursuant
to the Credit Agreement and will derive substantial additional
economic benefit from the Initial Lender’s forbearance with
respect to, and waiver of, the Existing Defaults and the other
concessions granted by the Initial Lender in acceding to the
request of the Borrower and the Guarantor to amend the Original
Credit Agreement and the other Loan Documents;
NOW THEREFORE,
in consideration of the foregoing
(all of which are incorporated as express representations and
covenants of Guarantor) and in order to induce the Initial Lender
and the Administrative Agent to waive the Existing Defaults and the
right to collect interest at the Default Rate as a result of the
Existing Defaults and to otherwise amend the Original Credit
Agreement and the Loan Documents for the benefit of Borrower and
Guarantor, Guarantor, for the benefit of the Administrative Agent
and the Beneficiaries, hereby amends and restates the Original
Guaranty in its entirety to read as follows:
1.
Guarantor, as a primary obligor, hereby unconditionally and
irrevocably, guarantees to the Beneficiaries that the Borrower will
fully and promptly pay and perform all of the Borrower’s
obligations under the Credit Agreement and the other Loan Documents
as now in effect or as the same may be modified, amended and/or
restructured at any time, including, but not limited to, the
obligation to repay the principal of the Term Loan (as defined in
the Credit Agreement), interest thereon, break costs contemplated
therein, prepayment fees contemplated therein, costs and expenses
(including legal fees and disbursements) of the Administrative
Agent and the other Lenders that the Borrower has agreed to bear
thereunder, and payment and performance of all other obligations of
the Borrower thereunder (all of the foregoing are hereinafter
referred to collectively as the “ Obligations ”)
and that, if for any reason the Borrower shall fail to pay or
perform any Obligation, the Guarantor will promptly pay or perform
the same without limitation or condition.
2.
The obligations of Guarantor under this Unlimited Guaranty shall be
continuing, absolute and unconditional under any and all
circumstances and shall be paid and performed by
Guarantor
2
regardless of (a) the
invalidity or unenforceability of any of the Obligations;
(b) any change in the time, manner, place of payment or in any
other term of any of the Obligations; (c) any impossibility,
impracticably, frustration of purpose, illegality, force majeure or
act of government; (d) the bankruptcy, winding up,
liquidation, dissolution or insolvency of the Borrower;
(e) the insufficiency, invalidity or unenforceability of any
collateral security or any other guaranty of the Obligations at any
time held by the Beneficiaries (or any of them); or (f) any
defense, offset or counterclaim which may at any time be available
to or asserted by the Borrower against the Beneficiaries (or any of
them).
3.
The Guarantor agrees, wit
